McLaren on track for road car expansion

For decades, McLaren has made a name for itself as a maker of successful racing cars. But now the company that brought supercars to the highways with Mercedes-Benz is going it alone.

McLaren Automotive, described as a premium automobile company, will unveil its first model in September, but the now-top secret model will only hit the road in 2011.

The launch will not be McLaren's first steps in to the world of production cars, but it does represent a new vision and direction, said Ian Gorsuch, Regional Director of the Middle East and Africa.

McLaren Automotive will be spun off from the McLaren Group to be an independent company to attract more shareholder investment. Just less than a 50 per cent stake – valued at £250 million (Dh1.5 billion) – is up for grabs, giving an insight into the commitment the UK-based company has made.

The Middle East already has a substantial interest, due to investments by Saudi entrepreneur Mansour Ojjah, and Mumtalakat, a the investment arm of the Kingdom of Bahrain. Watchmaker Tag Group is also on board but there remain opportunities for the UAE. The regional headquarters will be in Dubai.

Ron Dennis, former Principal of the McLaren F1 team and Executive Chairman and shareholder of McLaren Automotive, has spent two years developing the range.

"Ever since we revealed the McLaren F1 sports car in 1992, it has been a long-held dream of mine to launch a McLaren sports car company," said Dennis.

"Designing, developing and selling the best sports cars in the world is just half of that equation.

"Building them to previously unmatched levels of quality, with ground-breaking technologies in a production facility in the UK is key to satisfying that dream.

"If the McLaren Production Centre is given the go ahead, it will be an engineering centre of excellence of which McLaren and the UK can be proud," he said at the launch in May.

The company was founded in April, at the same time Dennis quit Formula One to take over. McLaren has, however, been developing sports cars for the past two years at its headquarters in Surrey, England. Unlike previous road car ventures in which the company teamed with Mercedes-Benz, this time the models will be all its own work.

The Middle East will represent one of the company's major markets, and will be the second market to receive the new cars after Europe.

With the growing wealth of the Gulf, Gorsuch believes it will prove a profitable venture for prospective dealers.

"It will only be a matter of days between the Europe and Middle Eastern launches," he exclusively told Emirates Business.

"I know from experience that other car companies tend to launch here a lot later than Europe or the United States, which creates a grey market.

"People want cars as soon as they are launched so if they can't get them here, they will look overseas and we don't want that," he said, adding that the cars have to be certified in Europe and the United States before they are approved here.

Although McLaren is making production cars, they will not be of the volume other manufacturers, even luxury car makers, churn out.

There will be an initial annual production of 1,000 vehicles, rising to 4,000 when the range is complete. Maserati, for instance, produced 7,353 cars in 2007.

But the scarcity of the vehicles means they will be bought at premium prices – which have yet to be announced.

Gorsuch, however, revealed the price tag will not be in excess of the £600,000 (Dh3.6m) it cost for a McLaren F1.

"There will be a slight premium over our competitors because we will have less volume but this will also help increase profits for the dealers," said Gorsuch, who formerly worked at Bentley Middle East.

"We're not looking to compete but looking to lead the market. When you have a high-end product, there will still be competition, but people's emotive side takes over and they go with the car that pushes more buttons,"

For this, customers will pay for F1-inspired technology, which includes carbon-fibre elements to make the car lighter and improve its performance.

"We have taken more processes and solutions in the car than actual parts so we call on the F1 team's expertise," said Gorsuch. "Buyers will have a road car that has similar principles of development to a race car."

And with interest already being shown, the team is confident buyers will come forward. A number of F1 and Mercedes SLR owners have already asked for more information, said the company.

Launching a premium auto company in a global downturn may raise a few eyebrows, but the people behind the project are optimistic by the time the first vehicles roll off the production line, the worst of the financial troubles will be over.

"Now is the best time because we are developing the car during the recession and most of the pundits say that by 2011 the economy will be picking up," said Gorsuch. "We haven't based our business plan on 2007/08, which was a boom time. We have much more conservative figures based on 2002/03."

"Ferraris, Lamborghinis and Bentleys are still selling, only in fewer numbers, so they will be starting the recovery period with a lot of stock hanging around whereas we will be starting with a clean sheet of paper."

The company is looking for a UAE dealer and insist it will have one, rather than the common trend of different firms in different emirates.

"Having more than one operating company works for volume manufacturers but not for luxury ones. We don't want our partner spending money on development – we want them to be profitable because if they are, they will look after customers," said Gorsuch.

The venture is also promoting the UK motoring industry, which has declined dramatically over the past decades with the demise of Rover, and Vauxhall and Ford closing manufacturing plants.

"We are adding to the industry because the technology is so advanced. Aston Martin makes advanced cars but McLaren is more about high-tech business," said Gorsuch.

There are 12 prototypes at present, but it is unlikely all will go into production. But unlike in the past, there will be a number of models on sale after the initial 2011 roll out.

McLaren Automotive began producing road-legal cars in 1992. The McLaren F1 ran for six years with 100 models built, until the Mercedes-Benz SLR McLaren took over. It remains one of the fastest road cars with a top speed of 386kph and has sold more than 2,000 units since its 2003 launch.

They have also proved to be a solid investment – a McLaren F1 recently sold at auction for a world record £2.5m (Dh15m).

"We are a brand with a pedigree and we don't want people to think it's a one-off car, we are building a company," said Gorsuch.


The growth of a legend

1963: Bruce McLaren launches the Bruce McLaren Motor Racing team.

1966: McLaren enters first grand prix. The team went on to become the only one present in every motorsport league, including Indianapolis 500 in the United States and the Le Mans championship. It has won 162 races, 12 drivers' championships – including Lewis Hamilton (pictured) last year – and eight constructors' championships as well as 400 podium places in 600 races.

1969: McLaren wins all 11 races in the Can-Am championship in North America.

1988: Sets the record for winning 15 out of 16 Formula One races in a season with Ayrton Senna and Alain Prost.

1989: McLaren Automotive launched.

1992: Street-legal McLaren F1 model is launched. It was the world's fastest production car with a top speed of 386kph.

1995: A McLaren F1, slightly modified from the road car, won the Le Mans 24 Hour race on its debut. It was the only globally recognised race the company had yet to win.

1998: Production ends on the F1 after 100 cars have been built: 64 McLaren F1s, 28 GTR models, five LM specials and three GTs.

2003: Mercedes-Benz SLR McLaren launched.More than 2,000 cars have been sold. They also launched the Stirling Moss edition. Production will stop at the end of this year.

2009: McLaren Automotive announces plans for a sports car company that will break away from the McLaren Group.

2011: A range of high-performance sports cars is due to come off the production line.

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